Ex-Shinhan chieftains given suspended prison terms

By Yi Whan-woo

Lee Baek-soon

A court handed the former heads of Shinhan Financial Group and its affiliate bank suspended prison terms on Wednesday for embezzling billions of won in 2010.

The Seoul Central District Court handed down a one and a half year jail term suspended for two years to both Shin Sang-hoon, the former president and CEO of one of the country’s major financial services, and Lee Baek-soon, who served as the head of Shinhan Bank.

The ruling came after the employees of the two companies accused Shin and Lee of embezzlement.

Shin, 64, led the Shinhan Financial Group between March 2009 and December 2010. During his term, he was suspected of using 1.5 billion won ($1.4 million) that should have been given to the group’s honorary chairman and advisor Lee Hee-gun, for private purpose.

Lee Baek-soon, 59, was the CEO of Shinhan Bank during the same period and was charged with embezzling 300 million won ($283,000) that was also to be paid to the honorary chairman in consulting fees.

The prosecution also indicted them for illegal use of donations from the group’s shareholders.

The acts took place amid a power struggle between Shin and Ra Eung-chan, the former chairman of the group, to take control of the group as well as its affiliates.

The prosecutors also looked into Ra but dropped all charges against him.

Shin and Lee Baek-soon tendered their resignation voluntarily following the prosecution’s probe.